Convenience, Not Discounts, Gets Consumers Online In India
Higher internet penetration, cheaper smartphones aid higher e-commerce sales.
Convenience has trumped discounts in keeping customers hooked on to online shopping, shows a recent study by the Boston Consulting Group (BCG) done in collaboration with the Retailers Association of India (RAI).
The report, 'Decoding The Digital Opportunity In Retail’, shows a shifting trend towards online shopping over the last two years, with 55 percent of those surveyed citing convenience as the main reason for buying on the internet, while a sizeable but marginally lower—52 percent—cited discounts as the determining factor.
Greater availability of products is another factor for buying on the internet, especially since net connectivity and high speed broadband is slowly making its way into tier-II cities as well. The study also shows that a lesser number of people are going to online platforms for variety now.
The catalyst for the increase in e-commerce penetration can be attributed to higher and cheaper internet connectivity, greater use of handheld surfing devices which will translate to a four-fold jump in India’s e-commerce market, over the next five years, says the report. The e-commerce market in 2016 was pegged at $12-14 billion and expected to exceed at least $50 billion by 2021, according to the report.
The Top Categories
Consumer electronics is expected to continue being the most popular segment, amongst consumers buying on online platforms, with penetration pegged to increase from the present 13-15 percent to any where between 38 percent and 42 percent by 2025.
Consumers are also expected to buy a lot more appliances, apparel, homeware, furniture, food and grocery on e-commerce portals.